Tag: European Union

EU's Finance Figures Start Race to the Top

After delaying the decision all year, last week's summit of EU heads of state and government finally agreed on concrete numbers for the scale of public financing needed for adaptation and mitigation in
developing countries.

ECO of course recognises that the EU is the first Annex I Party to do so, but observes that much more will be needed to seal the fair, ambitious and binding deal we need in Copenhagen. And now is the time for other developed countries to come forward with more ambitious proposals, to push the EU further in the right direction and propel the world towards success at COP 15.

By now, nobody should doubt that the scale of new and additional public money provided by developed countries for climate action in developing countries is one of handful of top issues that will make or break the Copenhagen deal. In our assessment, at least EURO 110 billion in new and additional public finance is required.

The EU starts by heralding a figure of EURO 100 billion which they say will be devoted to the total investments needed for climate action in developing countries. But looking more closely, this is not entirely public money or even largely so; it includes a public finance estimate of EURO 22-50 billion, plus money that will flow through carbon markets for the purchase of offset credits, and even beyond that, contributions to be made by developing countries themselves.

A public finance share of EURO 22-50 billion must be considered inadequate for three reasons.
1. The public share is simply not enough. There are serious concerns on the ability of the carbon markets to finance reductions beyond the tonnes sold for offsets. So much reliance on non-public sources will reduce assurance for delivery of the overall finance required. And further, even the underlying European Commission calculations noted that low Annex I targets would mean dramatically higher public financing needs. A quick look at the current aggregate Annex I mitigation targets suggests a rapid upward reappraisal of these financing estimates is needed.
2. It is not clear the EU thinks this money must be “new.” All public financing contributions under a Copenhagen agreement must be additional to the 0.7% of GDP that developed countries promised long ago to developing countries for development assistance. In addition, we know that the EU by itself will get new and additional annual revenue of around EURO 30 billion by 2013 within the EU Emission Trading Scheme, a perfect opportunity to allocate some of these new public revenues to meet international adaptation and mitigation needs.
3. This money needs to come from developed countries. The EU is clear that it prefers that developing countries (except LDCs) also contribute alongside developed countries, on the basis of their GDP and -- most importantly -- their emissions. ECO would like to remind the EU that under the Convention it is the rich countries who have financing obligations. Developing countries are already paying the costs of climate change daily in the impacts on the lives and livelihoods of their citizens.
So the EU has broken away from other developed countries and raised the flag on concrete financing discussions -- with real numbers attached, numbers that these international talks have been starved for all year. But this is an opening bid, a starting point for constructive discussions on financing this week.

The spotlight will now unavoidahly shift to the US and other rich countries, and they should start talking real numbers too. The race that the EU has started must be continued towards the top. EURO 110 billion in new and additional public finance from developed countries marks the finishing line for a fair and safe outcome in Copenhagen.

Presentation - Building on Kyoto - Dec 2004

While the Kyoto Protocol is not yet in force (due to the unilateral declaration by the George W. Bush Administration of the United States that it would not follow the Kyoto Protocol, as well as delay in Russiaís ratification of it) already many difficulties have been overcome, with deailed operational rules for the implementation of the Kyoto Protocol having been agreed upon at the Seventh Conference of the Parties (COP7), and more than 120 countries having ratified it.  This indicates that the large majority of the countries and people of the world are strongly in support of the Kyoto Protocol as the only international system of rules that could allow us to confront global warming.


Auctioning Off?

It's a familiar theme: developments within Annex I countries are worrying ECO. In the recent European Commission proposal, auctioning seems not to have made the grade.  This doesn’t instill confidence in European leaders whilst they make up their minds on a financial package at the end of this month.  Whilst Europe procrastinates, we see developing countries focus their efforts (quite rightly) on pushing Annex I on scale, not sources.

And so we come to a standstill.

As a decent proposal withers away, no one is nurturing it.   “So what?” some Parties might add.   Well, there is real merit in auctioning: it’s automatic, supports compliance, doesn’t have to flow through national budgets, provides money that is new and additional to ODA commitments, and can raise substantial amounts to name but a few.

So what’s the problem?  ECO says: back to the drawing board, and keep working to fill out the sketch into a complete design. .

[Article published in Climate Action Network's Eco Newspaper, Oct. 3, 2009 from Bangkok, Thailand UNFCCC negotiations - full PDF version here]

Restoring EU Leadership

Rewind 10 months to December 2008: in Poznan, negotiators prepare for another day of working group discussions. Meanwhile the rest of the continent is intently watching Brussels, where European leaders make the big political decisions on the EU’s 2020 climate package.

Now fast-forward one year to December 2009: it’s mid-session in the climate talks in Copenhagen and European leaders are again meeting in Brussels. What sort of leadership can we expect?

Europe still talks a good game on climate change and headlines their place at the head of the Annex I pack. But the cracks in confidence in the EU’s leadership have turned into chasms of concern as ambition has weakened.

At a moment when the vast majority of countries want a strong agreement but the negotiations remain mired in distrust and distraction, ECO suggests that European delegates consider these steps toward restoring EU climate leadership.

Step one is to communicate a compelling vision of what success looks like at Copenhagen: a vision based on staying as far as possible below 2oC through a global transition to low carbon economies and sustainable development for all.

Step two is to demonstrate that actions lead to success. That means moving onto new ground with mitigation and finance proposals that reflect scientific necessity rather than political expediency, and not simply waiting to see what the others will do first.

Step three is to shift the dynamic of the negotiations from ‘after you’  to ‘follow me’ – to build an “ambition coalition” of countries willing to take round after round of stronger action as others take steps for action and support. Together, ambition and action will lead to success.

The EU showed real leadership when it first tabled its 20%-30% target for emissions reductions below 1990 levels by 2020 - the first major emitter to make a unilateral agreement of this kind. It is ahead of most Annex I parties in its willingness to negotiate seriously on climate finance. But there are some problems.

• Rather than preparing for success by setting out a plan to move to 30%, many European countries seem to be quietly hoping that they can stick to 20% and avoid another battle with carbon polluting industries.

• Rather than sending a strong signal that Europe is serious about building a low carbon economy at home, it has proposed achieving much of its target through land use loopholes and cheap international offsets.

• Rather than recognising the need for additional, innovative and sustained public financing flows to help ambitious developing countries transform their economies and adapt to climate change in the coming decades, it is busy lowering expectations of Europe’s “fair share” of the bill.

It’s still not too late to turn this around. The economic crisis has created an opportunity.

Europe’s emissions have fallen to a point where achieving a 30% reduction is no more difficult or costly than 20% was expected to be when leaders signed on the dotted line. In fact, by adopting more ambitious targets, Europe can ensure that the economic recovery is built on low carbon investment rather than a return to business as usual.

Furthermore, if the EU really wants to reaffirm its role as a climate change leader, it will move toward a 40% reduction target. Not only is it the right economic pathway for Europe, it is also the most credible political strategy for success at Copenhagen.

[Article published in Climate Action Network's Eco Newspaper, Oct. 2, 2009 from Bangkok, Thailand UNFCCC negotiations - full PDF version here]


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